Hyosung ITX (KRX:094280) Has Affirmed Its Dividend Of ₩150.00

Hyosung ITX Co. Ltd's (KRX:094280) investors are due to receive a payment of ₩150.00 per share on 13th of August. The dividend yield will be 6.2% based on this payment which is still above the industry average.

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Hyosung ITX's Payment Could Potentially Have Solid Earnings Coverage

A big dividend yield for a few years doesn't mean much if it can't be sustained. The last payment made up 83% of earnings, but cash flows were much higher. Since the dividend is just paying out cash to shareholders, we care more about the cash payout ratio from which we can see plenty is being left over for reinvestment in the business.

EPS is set to fall by 0.6% over the next 12 months if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could reach 87%, which is definitely on the higher side.

See our latest analysis for Hyosung ITX

Hyosung ITX Is Still Building Its Track Record

The dividend's track record has been pretty solid, but with only 6 years of history we want to see a few more years of history before making any solid conclusions. The annual payment during the last 6 years was ₩500.00 in 2019, and the most recent fiscal year payment was ₩750.00. This implies that the company grew its distributions at a yearly rate of about 7.0% over that duration. Investors will likely want to see a longer track record of growth before making decision to add this to their income portfolio.

The Dividend's Growth Prospects Are Limited

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. However, initial appearances might be deceiving. Hyosung ITX hasn't seen much change in its earnings per share over the last five years.

Our Thoughts On Hyosung ITX's Dividend

Overall, it's nice to see a consistent dividend payment, but we think that longer term, the current level of payment might be unsustainable. In the past, the payments have been unstable, but over the short term the dividend could be reliable, with the company generating enough cash to cover it. Overall, we don't think this company has the makings of a good income stock.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. As an example, we've identified 1 warning sign for Hyosung ITX that you should be aware of before investing. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.